(INDIANAPOLIS) - Indiana Senate Republicans are pushing ahead with a new round of tax cuts slated for 2026, advancing legislation that would eliminate state taxes on tips, overtime pay, and interest on loans for American-made vehicles. Senate Bill 243 cleared a key committee Tuesday, marking a significant step forward in the GOP-backed effort to reduce the tax burden on workers and consumers.
Rodric Bray, president of the Indiana Senate, said the proposal is intended to let Hoosiers keep more of what they earn while aligning state tax policy with existing federal provisions. Republican lawmakers argue the measure builds on a series of recent tax reductions already benefiting Indiana residents.
The bill moves ahead as Indiana's flat income tax rate dropped again this month under a previously approved schedule, and as a major property tax relief package passed by lawmakers begins to take effect statewide. Supporters say the combined measures reflect a broader strategy to provide tax relief while maintaining the state's fiscal stability.
Senate Bill 243 now continues through the legislative process as lawmakers negotiate Indiana's wider budget and tax priorities for the year ahead.